Prime Highlights: 

Google parent company, Alphabet, is in advanced negotiations to acquire cloud security firm Wiz for $33 billion, marking its largest acquisition to date. 

Alphabet’s new offer significantly exceeds the previous $23 billion proposal from 2024, which collapsed due to regulatory concerns. 

Key Background: 

Google’s parent company, Alphabet, is reportedly in advanced negotiations to acquire the cloud security firm Wiz for approximately $33 billion, according to sources familiar with the matter. If finalized, this deal would mark Alphabet’s largest acquisition to date. 

The Wall Street Journal reports that the offer represents a significant increase from the $23 billion proposal made last year, which ultimately fell through due to concerns over potential regulatory challenges from Wiz’s directors and investors. However, the new round of discussions suggests the deal could be finalized soon, provided no unforeseen complications arise. 

Founded in 2020 by alumni of Israel’s prestigious cyber intelligence unit, Wiz provides cloud security services to many of the United States’ top 100 largest companies. The company has experienced rapid growth, reaching $500 million in annualized recurring revenue last year, with aspirations to double this figure by 2025, according to co-founder Roy Reznik. 

The potential acquisition would enhance Alphabet’s position within the cybersecurity sector, further bolstering its cloud infrastructure business, which generated over $43 billion in revenue last year. Google Cloud currently holds a 12% share of the global cloud market, ranking third behind Microsoft Azure and Amazon Web Services. 

Despite the leadership change in Washington, the deal is likely to face significant regulatory scrutiny. Although the Biden administration’s antitrust policies may ease under President Donald Trump’s administration, the creation of a cybersecurity powerhouse could attract the attention of regulators. 

Previously, Wiz had planned to go public after earlier acquisition discussions with Alphabet fell through. In its most recent private funding round in May 2024, Wiz was valued at $12 billion, attracting investors such as Andreessen Horowitz, Lightspeed Venture Partners, Thrive Capital, Index Ventures, and Sequoia Capital. Alphabet’s largest acquisition to date was its $12.5 billion purchase of Motorola Mobility, which it later sold. In 2022, Alphabet further strengthened its cloud portfolio by acquiring cybersecurity firm Mandiant for $5.4 billion.